Federal Reserve Board Governor Waller: Reiterates DeFi-friendly stance and advocates private sector-led payment innovation

Federal Reserve Governor Christopher Waller reinforced his supportive stance on decentralized finance (DeFi) and private-sector payment innovation at the Wyoming Blockchain Symposium. He argued that DeFi should not be viewed as threatening, but rather as a natural technological evolution that supplements—rather than replaces—traditional finance. Waller compared DeFi transactions, such as using stablecoins and smart contracts, to everyday activities like shopping with a debit card.

Key points from his speech and previous statements include:

DeFi serves as a new tool for asset transfers and transaction recording, with functions similar to existing payment systems.
Stablecoins are highlighted as a market-driven solution that enhances global use of the U.S. dollar, especially in regions with high inflation or limited financial access. They offer benefits like 24/7 service and fast transfer speeds.
Waller advocates for private sector leadership in payment innovation, emphasizing that competition and profit motives drive efficient and consumer-responsive advancements.
The recent passage of the GENIUS Act in the U.S. is noted as significant progress for the stablecoin market.
The Federal Reserve is actively researching tokenization, smart contracts, and AI in payments to support both its operational role and private sector use of central bank infrastructure.

Waller’s consistent, pro-innovation perspective positions DeFi and blockchain technologies as complementary to the existing financial ecosystem.

Federal Reserve Governor Christopher Waller said DeFi shouldn’t be considered “scary” just because it operates outside of traditional banking infrastructure.

At the 2025 Wyoming Blockchain Symposium, Waller defined blockchain-based transactions as a "natural evolution of technology" rather than a "disruptive threat."

He compared DeFi operations to traditional shopping, pointing out that the basic process of "purchasing cryptocurrencies with stablecoins through smart contracts" is exactly the same as "shopping with a debit card at a grocery store."

“There’s nothing to be afraid of using smart contracts, tokenization, or distributed ledgers in everyday transactions,” Waller said.

The Federal Reserve Governor positioned DeFi technology as a "new tool for transferring assets and recording transactions," and emphasized that its functions are highly similar to existing payment methods.

Waller advocates that private sector-led innovation should be a core driver of the development of payment systems and sees stablecoins as “the latest example of a market-driven solution.”

In addition, he believes that the development of stablecoins has expanded the use of the US dollar globally, especially in countries with high inflation and a lack of inclusive financial services.

Waller even emphasized that stablecoins have the characteristics of "24-hour uninterrupted service" and "fast transfers", which are not only expected to "maintain and expand the international status of the US dollar", but also improve the efficiency of retail payments and cross-border payments.

The speech came on the heels of the passage of the GENIUS Act, the first core cryptocurrency legislation signed into law in the United States, which Waller called a “major step forward for the payments stablecoin market.”

Waller's statement in Wyoming is a continuation of his "pro-innovation" stance throughout 2024.

Last October, at the Vienna Macroeconomics Seminar, Waller pointed out that DeFi is more likely to "supplement traditional finance" rather than "completely replace traditional finance."

He acknowledged DeFi’s potential to “simplify financial activities,” while also emphasizing that financial intermediaries still play an important role for most people.

In November 2024, at the Clearing House's annual meeting, Waller advocated for market-driven solutions in the cryptocurrency and payments sectors, emphasizing the advantages of the private sector in driving innovation through competition.

He believes that profit motives and market competition allow private companies to make better choices in technology investment decisions and consumer demand assessments.

Waller also mentioned that the Federal Reserve is conducting technical research on tokenization, smart contracts, and artificial intelligence in the payment sector. This initiative will not only help the Federal Reserve fulfill its responsibilities as a payment system operator, but also provide space for private enterprises to utilize central bank infrastructure.

Waller said the payment system is undergoing a "technology-driven revolution" driven by advances in computing power, data processing and distributed networks.